The Flipside of Comparative Payment Schemes

Thomas Buser and Anna Dreber

No 13-190/I, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: Comparative payment schemes and tournament-style promotion mechanisms are ubiquitous in the work place. We test experimentally whether they have a negative impact on the willingness to cooperate. Participants first perform in a simple task and then participate in a public goods game. The payment scheme for the task varies across treatment groups. Compared to a piece-rate scheme, individuals in a winner-takes-all competition are significantly less cooperative in the public goods game. A lottery treatment, where the winner is decided by luck, has the same effect. In a competition treatment with feedback, winners cooperate as little as participants in the other treatments, whereas losers cooperate even less. All three treatments lead to substantial losses in the realised social surplus from the public good while having no significant impact on performance. The public go ods game is payoff-independent and is played with a separate set of others; we therefore estimate a psychological effect of comparative pay on the willingness to cooperate.

Keywords: comparative pay; competition; cooperation; gender differences; incentive schemes (search for similar items in EconPapers)
JEL-codes: D03 D23 J16 J33 (search for similar items in EconPapers)
Date: 2013-11-28
New Economics Papers: this item is included in nep-cdm, nep-exp and nep-hrm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
https://papers.tinbergen.nl/13190.pdf (application/pdf)

Related works:
Journal Article: The Flipside of Comparative Payment Schemes (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20130190

Access Statistics for this paper

More papers in Tinbergen Institute Discussion Papers from Tinbergen Institute Contact information at EDIRC.
Bibliographic data for series maintained by Tinbergen Office +31 (0)10-4088900 ().